OCTOBER, 21, 1862.

General THOMAS, Second in Command:

GENERAL: General Buell orders as follows: Wood's division to be sent back at once to Lebanon. One brigade from either of the other divisions to be sent promptly to destroy the salt-works about Manchester. One regiment to be sent immediately to Somerset to guard supplies, which will be sent there from Lebanon to meet Van Cleve and Smith's divisions. As soon as the brigade returns from Manchester and the two divisions have three days' supplies General Crittenden will march in person with them to Somerset. Three days' supplies for the troops from London to Somerset will be pushed forward as rapidly as possible. Having made these arrangements you will come to Lebanon.

It is reported that Morgan's cavalry, or part of it, still hangs about the Big Hill or on the Richmond road. If an opportunity offers to act against him pending these movements, commanders should avail themselves of it.

The regiment of cavalry should go to salt-works with the brigade. The baggage for Smith's and Van Cleve's divisions will be sent to them from Lebanon.

Direct General Crittenden to report daily to Lebanon the position of his troops and anything else of interest. Two regiments from Gilbert's corps and a regiment and a half of cavalry have been ordered to foot of Big Hill, on north side, via Paint Lick, to drive out the cavalry said to be there.

There will be two regiments at Danville for the present; that is, until Gilbert's two regiments return from the Big Hill to that place. McCook's and Gilbert's corps are on the march to Lebanon.

The main body of our cavalry is pursuing Morgan via Bardstown, Boston, Elizabethtown, &c.

We are just starting for Lebanon and will campat Danville to-night. Send to one of the divisions for an operator and open the office at Mount Vernon and communicate with us to-night.

Nothing but the three days' rations for the troops should be allowed to come over this route for Van Cleve and Smith, as everything can better go to Somerset.

Respectfully, &c.,

JAMES B. FRY,

Colonel and Chief of Staff.

INDIANAPOLIS, IND.,

October 21, 1862 - 9.15 p. m.

His Excellency the PRESIDENT:

An officer just from Louisville announces that Bragg has escaped with his army into East Tennessee, and that Buell's army is counter-marching to Lebanon. The butchery of our troops at Perryville was terrible, and resulted from a large portion of the enemy being precipitated upon a small portion of ours. Sufficient time was thus gained by the enemy to enable them to escape. Nothing but success, speedy and decided, will save our cause from utter destruction. In the Northwest distrust and despair are seizing upon the hearts of the peopled.

O. P. MORTON,

Governor of Indiana.